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 The
good news around here this week is that Zendo
was one of the 5 winners in this
year's Mensa Mind Games Competition! Yay! Congratulations,
Kory!
Now for the bad news. Despite this recent feather in Zendo's
cap, we have decided to let Zendo go out of print. The reasons
behind this possibly shocking decision are complex, and yet simple:
it's all about money.
More to the point, the problem is the costliness of those
lovely pointy pyramids. The
Icehouse system has yet to be a money-maker for us... our
success as a company is due almost entirely to the strength of
the sales of our card games, most especially Fluxx,
which is far and away our biggest hit. We've sold ten times as
many copies of Fluxx as we have of our second biggest hit, Chrononauts.
Fluxx accounts for more of our sales than everything else we
make, combined.
The pyramids on the other hand always cost too much and sell
too slowly. They'd be cost-effective enough for a game which
used only one of each color, as single pawns, for example, but
so many pyramids are required for a full Icehouse set as to make
the costs really quite staggering. Our pricing on them two years
ago, when we did the first print run of Zendo, gave us almost
no margin for profit, and since then, the cost of plastic has
sky-rocketed (being petroleum-based products, the cost of plastic
goes up with the cost of gas). So we really can't afford to make
any more until we find a more cost-effective means of getting
the pyramids manufactured.
This leads us to the question of going to China. Always in
the past we have resisted the lure of the Orient, but obviously,
the idea comes up in any conversation about how to get small
plastic parts manufactured more cheaply. It goes against all
our hippie
ideals to even consider exporting this job... but the idea keeps
coming back, particularly since sales people from far away are
always offering such services.
A few months ago, Kristin
finally broke down and -- just for the sake of argument, you
understand -- allowed an overseas manufacturer to quote on making
our pyramids. And as you might expect, the numbers are astonishing.
Icehouse pieces would easily be profitable if we were getting
them made overseas, even with the added shipping costs. Heck,
we could probably even lower the price if we did that. But could
we sleep at night?
I can't promise we'll never consider it again, but right now,
we're still refusing to go to China. We are determined to find
a way to get pyramids made more cheaply here at home. We love
our plastics manufacturer, KLON,
a small company located just up the highway from us, north of
Baltimore. They've been hit hard by the economy these last few
years, and they've lost a lot of business to overseas competition,
but they're still there, hanging on by their fingernails, and
they're eager to make more pieces for us and ready to find a
way of doing so more cheaply. And it's not like there's any mystery
about what we need to do: we need a bigger mold. The problem
is, new molds cost big bucks.
To date, all injection-molded Icehouse pieces ever made have
come out of the
exact same mold, a "family" mold we commissioned
in 1999 at a cost of around $10,000. This mold makes just 1 piece
of each size at a time, which means the pieces are very pricey.
This is made worse by the fact that the press must be run relatively
slowly, due to the differently-sized pieces being made at the
same time. On top of that, we couldn't afford to buy extra-fancy
(i.e. even more expensive) mold gating, meaning that each piece
has to be cut free from the spur with clippers, by hand, which
of course adds yet more to the cost of the job. (We need a mold
with a hot runner, instead of a cold runner, if you want to get
technical about it.) Finally, as if all that weren't enough,
the pieces are then delivered to us loose in big boxes, meaning
a lot of expensive and error-prone hand counting has to be done
in order to assemble finished game sets.
All that was just fine back
in 1999 when we were first pioneering these injection-molded
pyramids... but we just can't afford to make sets that way any
longer. What we need before we can make any more Icehouse sets
is a trio of new molds, each of which makes 5 pieces at a time,
with hot runner gating. And a new molding system like that is
going to cost tens of thousands of dollars to create, which of
course is way more money than we have available.
That brings us to the next topic, which is our overall funding
problem. We need money. Quite a lot, actually. Obviously, we
had hoped for our company
to be operating in the black by now, but the fact is, building
this company up from scratch is expensive, and we won't know
how much it will have cost until after we are all done. But even
as another year goes by in which we must borrow more money to
continue, we still have enough faith and confidence in our products
to know that we will *eventually* be hugely profitable. Games
follow a slow path to success, but the real hits become household
names that sell millions of copies and remain saleable for decades.
We believe Fluxx has the potential to become another Uno.
We've sold 200,000 copies thus far, and the market for it just
keeps on expanding as it creeps further and further into the
public's consciousness. Someday, we will sell our millionth Fluxx
deck, by which time I expect our money woes will be long over...
and yet, we'll still just be on our way to doing the kind of
sales numbers that Uno has achieved (which when last I heard
were somewhere well over 25 million copies sold).
But that's in the glorious future.
Right now, money is very tight. As our expenses continue to exceed
our sales volume, we keep needing to borrow more money for growth.
So we have a lot of debt we have to service, plus we need money
to print all the new stuff we want to create (like Eco-Fluxx
and Just
Desserts and everything else on the
Stove), plus we need more money to reprint the stuff we're
running out of, plus we need more money to pay more workers because
we need more help to get all this stuff done.
All of this leaves us wondering how best to find more investment
capital. Here are a few of the ideas we're considering:
- Arrange a series of additional personal loans like those
we already rely on (Thanks again, existing investors!)
- Find an angel investor willing to invest heavily
- Start playing and then win either a lottery or a high stakes
poker tournament
- Pull off some sort of publicity stunt that gets us the extra
attention we need to push our sales past the tipping point
- Strike black gold (or "Texas Tea") while shooting
at some food in the backyard, then sell our land to an oil company
- Get a government agency to grant us the money to buy the
new Icehouse mold, as a way of supporting small companies and
preventing the outsourcing of American jobs
- Invent time travel, then go back in time and invest in the
stock market, horse-racing, etc
- Ask fans of Icehouse (and American manufacturing) to contribute
to a "new mold" fund
None of these plans will be fast or easy to accomplish, but
we'll figure it out, we always do.
We are working on plans for keeping the Icehouse system going,
with or without the added money we need for better tooling. If
we must, we can still get another run of pyramids done the old
way, even if we lose money on them and the price for the set
is $50. It's all in the new Icehouse
Manufacturing RFQ (Request For Quote) which Kristin posted
this week. Even if we can't afford to buy a new mold this year,
we're still hoping to publish at least a small print run of Volcano
sets in time for the holidays. But Zendo probably won't be reprinted
this year.
For over 15 years,
Kristin and I have been trying to make money selling these pesky
little pyramids, and basically, we never have. But we still believe
in the pyramids! We continue investing our money in the system,
and along the way, we've repeatedly re-invented the product.
As new games have been developed for the pyramids, we've been
changing the focus, always searching for that "killer ap"
that will get large numbers of people to finally buy an Icehouse
set.
When
we published Zendo, we were hoping it would be that Killer
Ap... but now we think it's really Volcano. At the Little
Experiments we've been running, we've been teaching everyone
Zendo, IceTowers, and Volcano, and it's been really obvious to
us which one has been the universal favorite: Volcano.
The honest truth is, sales of Zendo have been disappointing.
It's been almost 2 years since we printed just 2000 copies, and
we are only now getting close to selling out of that first print
run. Even winning
the Origins Award for Best Abstract Game of the Year did
little to increase sales of Zendo. The biggest reason for this
may be the price... we kept the price as low as we could, but
$40 is still too much for many people's budget, even given the
great value the set represents because of all the different games
you can play with the pieces. Maybe people are confused or put
off somehow by the mystical Zen theme, or just feel that Zendo
is too much of a brain-burner for their tastes. We can only speculate.
But the hard reality we have to face is the fact that Zendo sets
haven't been selling very well.
Instead, what we're hearing is that Volcano
is the game people really like best, so that's the one we're
going to shift our attention (and limited resources) over to.
Hopefully someday we'll be able to bring Zendo back, when we
have more money and aren't having to choose between publishing
new titles and keeping old ones in stock. But given our current
funding constraints, it just doesn't make sense for us to reprint
a slow seller at this time, even if it has won some major awards.
We still have around a hundred Zendo sets in our warehouse,
so if you haven't gotten this boxed edition yet, you still have
a chance. You won't find it in stores much longer, since we have
stopped sending them to our distributors - and to make sure they
all go to good homes, and to stretch the supply as long as possible,
the price for these last few Zendo sets will soon go up to $50.
 Have
a Great Week, and Thanks for Playing Our
Games!
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